Opinion
W.C. Nos. 4-751-083, 4-751-083.
January 5, 2010.
FINAL ORDER
The claimant seeks review of an order of Administrative Law Judge Mottram (ALJ) dated September 15, 2009, granting summary judgment. We affirm.
The claimant suffered an admitted injury on January 31, 2008. The respondents filed a general admission of liability admitting for temporary disability benefits subject to a 50 percent offset for an alleged safety rule violation. The matter proceeded to hearing before ALJ Walsh. ALJ Walsh determined that the respondents had failed to demonstrate the claimant's action was willful and that the employer had adopted a rule requiring compliance by the claimant. ALJ Walsh ordered the respondents to pay the claimant full benefits without the 50 percent offset.
The claimant then sought penalties against the respondents, under § 8-43-304(1) C.R.S. 2009, for frivolously taking the offset for a safety rule violation. The respondents filed a Motion for Summary Judgment arguing that under Saddoris v. J. Brach Sons Trucking Inc., W.C. No. 4-763-372 (November 05, 2008), the insurer is allowed to take a safety rule violation offset in the first instance, without awaiting adjudication of the issue from an ALJ. The ALJ found that the claimant had failed to raise any genuine issue of material fact that could withstand the Motion for Summary Judgment. The only issue raised by the respondent in her Response to the Motion for Summary Judgment was whether respondents were required to act in good faith in investigating the alleged safety rule violation. The ALJ, citing Allison v. Industrial Claim Appeals Office 916 P.2d 623 (Colo. App. 1995), determined that there is no provision in the Act or in the rules that would prohibit respondents from arguing that a safety rule violation occurred, regardless of whether the alleged violation was frivolous. Therefore, the ALJ found that the respondents had not violated any provision of the Workers' Compensation Act (Act) or Workers' Compensation Rules of Procedure that would subject them to penalties under § 8-43-304(1). Consequently, the ALJ granted summary judgment in favor of the respondents, struck the claimant's application for hearing, and denied and dismissed the claim of penalties against the respondents for filing an admission claiming a safety rule violation.
On appeal, the claimant acknowledges the authority of Allison v. Industrial Claim Appeals Office and Saddoris v. J. Brach Sons Trucking Inc., but argues that these cases were wrongly decided. The claimant asserts that a frivolous denial of benefits by an insurance carrier is a violation of the Act which subjects the carrier to penalties pursuant to § 8-43-304. The claimant further asserts that the insurance carrier must first prove its entitlement to withhold benefits from an injured worker before it reduces indemnity benefits for a safety rule violation pursuant to § 8-42-112, C.R.S. 2009. Therefore, the claimant contends that it was error for the ALJ to grant summary judgment in favor of respondents. We disagree with both of the claimant's assertions.
Under the rules an ALJ may enter summary judgment where there are no disputed issues of material fact. See Office of Administrative Courts' Rule of Procedure (OACRP) 17, 1 Code Colo. Reg. 104-3 at 7. Moreover, to the extent that it does not conflict with OACRP 17, C.R.C.P. 56 also applies in workers' compensation proceedings. See Morphew v. Ridge Crane Service, Inc., 902 P.2d 848 (Colo. App. 1995); Nova v. Industrial Claim Appeals Office, 754 P.2d 800 (Colo. App. 1988) (the Colorado rules of civil procedure apply insofar as they are not inconsistent with the procedural or statutory provisions of the Act). We note that summary judgment is a drastic remedy and is not warranted unless the moving party demonstrates that it is entitled to judgment as a matter of law. Van Alstyne v. Housing Authority of Pueblo, 985 P.2d 97 (Colo. App. 1999). And all doubts as to the existence of disputed facts must be resolved against the moving party, and the party against whom judgment is to be entered is entitled to all favorable inferences that may be drawn from the facts. Kaiser Foundaton Health Plan v. Sharp, 741 P.2d 714 (Colo. App. 1987). However, once the moving party establishes that no material fact is in dispute, the burden of proving the existence of a factual dispute shifts to the opposing party. The failure of the opposing party to satisfy its burden entitles the moving party to summary judgment. Gifford v. City of Colorado Springs, 815 P.2d 1008 (Colo. App. 1991).
In the context of summary judgment, we review the ALJ's legal conclusions de novo. See A.C. Excavating v. Yacht Club II Homeowners Association, 114 P.3d 862 (Colo. 2005). However, pursuant to § 8-43-301(8), C.R.S. 2009, we have authority to set aside an ALJ's order only where the findings of fact are not sufficient to permit appellate review, conflicts in the evidence are not resolved, the findings of fact are not supported by the evidence, the findings of fact do not support the order, or the award or denial of benefits is not supported by applicable law.
Here, the question on review is generally whether applicable law supports the ALJ's grant of summary judgment on the ground that, even assuming the respondents raised a frivolous safety rule claim, they were not subject to penalties under § 8-43-304(1). We do not understand the claimant to be contending that there were disputed issues of fact which would have to be resolved at a hearing, other than whether the respondents frivolously denied benefits. However, for the purposes of his decision, the ALJ assumed that the respondents frivolously raised a safety rule claim. We further note that it does not appear ALJ Walsh determined that issue. In any event, we conclude that the law presently supports the ALJ's order.
We first note that in our view the claimant's reliance on Travelers Ins. Co. v. Savio 706 P.2d 1258 (Colo. 1985) is misplaced. In Savio, the court held that the Act does not preclude an employee from bringing a common-law tort action against workers' compensation insurance carrier for bad faith. The Savio court balanced the right of the insurance carrier to reject a noncompensable claim submitted by its insured and the obligation of such carrier to investigate and ultimately approve a valid claim of its insured. In Savio the court found that the plaintiffs bad faith claims were not redressed by any of the penalty provision of the Act, thus drawing a distinction between claims for bad faith and the penalty provisions under the Act.
Here, the issue is not whether the carrier engaged in bad faith, which might subject it to civil liability. Rather the issue is whether or not penalties pursuant to § 8-43-304, could be imposed. Section § 8-43-304, authorizes an ALJ to impose a penalty of up to $500 per day for each day a party violates any provision of the Workers' Compensation Act, fails or refuses to perform any duty lawfully enjoined within the time prescribed by the director, or refuses to obey any lawful order made by the director or the panel. The first step in the process of imposition of penalties under § 8-43-304 is for the ALJ to determine if the respondents' conduct violated the Act, a rule, or an order.
The ALJ found that, even assuming for purpose of the motion for summary judgment that the purported safety rule violation raised by the respondents was frivolous, the respondents still had not violated any provision of the Act or rules. There was no allegation that the respondents had violated an order.
In our view, the ALJ's decision is consistent with Allison v. Industrial Claim Appeals Office 916 P.2d 623 (Colo. App. 1995). In Allison, the court determined that there is no statutory requirement to admit for the full amount of temporary benefits and the respondents were only obliged to continue to pay benefits pursuant to the admission. Here, there is no dispute that the insurer is bound by its admission and has paid benefits pursuant to that admission. The claimant argues that Allison was wrongly decided, but we are of course bound by the published opinions of the Colorado Court of Appeals. See also Colorado Compensation Ins. Auth. v. Industrial Claim Appeals Office, 18 P.3d 790 (Colo. App. 2000) (citing Allison, determined that "[a]n insurer has no legal duty to admit liability for temporary disability benefits").
Moreover, the ALJ's determination is consistent with the Panel's reasoning in Vaughn v. Monfort Inc., W.C. 4-102-119 (August 27, 1992). In Vaughn, the Panel was faced with a similar dispute concerning an admission of liability for, and payment of, a reduced amount of TTD benefits based on the respondents' assertion that the claimant's injury resulted from a willful violation of a safety rule. The Panel noted that the respondents had admitted for liability at a reduced amount of benefits and had made payment accordingly. Therefore, the Panel found there was no violation of an order, statute or rule and affirmed the ALJ's dismissal of the claimant's request for penalty claims. We see no reason to depart from the reasoning in Vaughn or Saddoris v. J. Brach Sons Trucking Inc. In our view, the applicable law supports the ALJ's grant of summary judgment on the issue of penalties.
IT IS THEREFORE ORDERED that the ALJ's order dated September 15, 2009 is affirmed.
INDUSTRIAL CLAIM APPEALS PANEL
____________________________________ John D. Baird
____________________________________ Thomas Schrant
VICKI CARR, DURANGO, CO, (Claimant).
PASCO/SW, INC., Attn: MS YVETTE TANNER, CORTEZ, CO, (Employer).
PINNACOL ASSURANCE, Attn: HARVEY D FLEWELLING, ESQ., DENVER, CO, (Insurer).
TIM GUILL, Attn: TIM GUILL, ESQ., C/O: ATTORNEY AT LAW, DENVER, CO, (For Claimant).
RUEGSEGGER SIMONS SMITH STERN LLC, Attn: JOHN SANDBERG, ESQ., DENVER, CO, (For Respondents).
PINNACOL ASSURANCE, Attn: GINA GRIEGO, DENVER, CO, (Other Party).